When people move, especially for work they often end up asking their Edmonton bookkeeping company if they can claim their expenses. This can help them minimize the taxes that they owe to the government at the end of the year. Which can be very beneficial.
For example, someone might decide that they want to move closer to work so that they can spend less time commuting, and more time with their family. However, the biennial house, and spend time moving from one house to the other. And then find out at the end of the year. That they are not eligible to claim any of their moving expenses at all.
The reason that would happen, is because there are several conditions that need to be met. In order to determine if a person can claim those moving expenses on their personal tax return.
The first condition that needs to be met, is that they cannot have already been reimbursed for their expenses through another means. For example, if someone is moving because of a job promotion, and they are getting their moving expenses reimbursed by their new company. They cannot claim this on their taxes.
The next condition needs to be met. Is that if people are moving from outside the country to within Canada. The move must be from within Canada, to another location within Canada. In order to be claimable on their income tax return.
And finally, people need to ensure that they are moving at least 40 km closer to their work. Which does not mean the entire movement must be at least 40 km. That they are actually functionally getting closer to their place of work. If they are moving 40 km closer. Then they need to ensure that they have sold their previous home if the owned it.
However, the Canada revenue agency allows a caveat for people who have not yet sold their home. If they can provide documentation to their Edmonton bookkeeping company that they have need reasonable attempts to sell their home. They can then claim their moving expenses on their taxes.
In addition to that, people need to understand that there is a maximum amount that they can claim. Which is related to how much money they have earned in that year.
Although it is important to note that Canada revenue agency allows people to carry forward their moving expenses to the following year. Therefore, if a person is not going to be able to claim a full year of income. Maybe because they were out of work for a certain period of time. Or perhaps they took time off to move. And as a result, do not have a full year of income.
Then they might be better off claiming their moving expenses in the future year when the can claim a full year of income. Or because they will be making considerably more money in the new year.
Because of all these considerations, it is beneficial for people to utilize and Edmonton bookkeeping company to help them navigate the complexities of their moving expenses. So that they can end up with the most money being claimed at the end of the year.
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It is very important for people to minimize the taxes that they owe the government says Edmonton bookkeeping. Because average Canadians pay so much of their entire income in a variety of taxes. The Fraser Institute has calculated that the average Canadian pays approximately 43% of their entire income in taxes. Not just their income taxes, but CPP, EI, GST and PST, fuel tax, and carbon taxes just to name a few.
In fact, taxes make up so much of what average Canadian have to pay. That only 37% of the remaining amount goes towards things like food, and shelter.
This is why people do what they can to claim as many expenses as possible. So that they can end up minimizing the taxes that they owe the government at the end of the year.
And while moving expenses are claimable on their personal taxes. People might not realize that not everything that they paid for while moving can be claimed. But also, there might be a large number of moving expenses that they can claim. That they may not realize are valid moving expenses.
By understanding what they can claim and what they cannot claim. Can help people keep the right to receipts. So that they can end up claiming as much as they possibly can. To minimize their taxes.
For example, people need to understand that as long as they are moving their entire family. That they are going to be able to claim the moving expenses for their entire family says Edmonton bookkeeping.
While people generally understand that they can claim their vehicle expenses such as fuel, as well as meals and accommodations during their move. Other surprising moving expenses would be if they had to purchase additional or different insurance for their move, any vehicle maintenance that was necessary during their move. Such as getting new tires, oil change, or having a mechanic look at their engine.
Some people might also be very surprised to realize that temporary living expenses are also of valid moving expenses. This might be incurred because they needed to have their house packed up a day or two before they actually started their journey to their new home. And they need to stay in a hotel or motel. Because the cannot stay home with nothing in it.
As long as they are keeping their temporary living expenses to a minimum of fifteen days. These are all expenses that they are allowed to claim. That they may not realize it at the time.
The best scenario would be for people to keep every single receipt that they incurred during their entire move. And then bringing it all to Edmonton bookkeeping company. He is going to be able to figure out exactly what they can claim and how much they can claim.
By letting the experts figure it out, can help ensure that people are claiming as much as they can on their income tax return. So that they can reap the best benefits.